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21 Chinese companies will team up on smart car joint venture

By Li Fusheng | chinadaily.com.cn | Updated: 2017-12-22 16:46
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An unmanned car iEV7S of JAC Motors is on display at the first China Industrial Design Exhibition in Wuhan, Central China's Hubei province, Dec 2, 2017. [Photo/IC]

Twenty-one Chinese companies, including State-owned carmakers, telecom operators and tech giants, are planning to build a 1 billion yuan ($152 million) joint venture that will specialize in developing smart and internet-connected cars, according to one of the potential investors.

Big names on the list of investors are FAW Group, Dongfeng Motor Corporation, Chongqing Changan Automobile, China Mobile, China Unicom as well as ride-sharing giant Didi Chuxing's parent company Beijing Xiaoju Technology, said Shanghai Baolong Automotive Corporation in its filing to the Shanghai Stock Exchange on Wednesday.

Baolong said that each of the 21 shareholders will invest 50 million yuan for 4.76 percent equity, with the payment scheduled to be made before Jan 31, 2018.

According to Baolong, the Beijing-based joint venture, which is temporarily known as China Intelligent and Connected Vehicle Research Institute, will run independently. It will undertake national research and development programs, help the investors develop their products and offer consulting services.

Yale Zhang, managing director of Shanghai-based consulting firm Automotive Foresight, said the ambitious move, which is the largest of its kind China has seen in its smart and internet-connected car efforts, will be a good effort.

"Cooperation is necessary in this aspect. You know smart cars are difficult for one carmaker to develop no matter how big, and carmakers will feel a little worried if they rely too much on platforms of tech giants like Google or Baidu."

Smart and internet-connected cars are one of the most important highlights in China's automotive development plan released in April.

By 2025, China should be a global leader in such cars, according to the plan.

Earlier this month, the government released a plan to build a reliable and safe platform for smart and internet-connected vehicles that can support highly autonomous driving technologies by 2020.

Zhang believes China is likely to realize its goal of gaining a head start in this aspect based a combination of factors.

"For example, in the past two years we have seen more and more professionals in artificial intelligence. The government is placing a lot of emphasis on it and Chinese people are open to such new technologies, so it is likely for China to stand out."

People in China have the most positive perspectives on autonomous driving, as Ford Motor Co found based on a recent survey of 9,042 people from nine countries and regions.

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